What effect will Trump’s Tariffs have on car parts and cost of ownership
Valerie Raskovic
May 06, 2025.jpg "What effect will Trump’s Tariffs have on car parts and cost of ownership")
Tariffs serve as an additional tax on imported goods. The basic ideology behind using tariffs is to encourage local production by making goods that come oversees far too expensive. In theory the idea behind tariffs may seem sound and even somewhat patriotic however, it does not take under effect the fact that almost all modern manufacturing and production is part of the global supply chain and cutting out key suppliers that are able to manufacture various components and materials can have a devastating effect on the consumer and the US economy.
One of the goods that is most impacted by these new tariffs are automotive parts. Regardless if you own a Ford or a Honda, regardless if your car was assembled in a US factory or abroad, we are all effected by tariffs as they have significant implications for the cost of owning and maintaining a vehicle. The parts for both domestic and foreign brands are sourced from various countries to ensure cost efficiency and access to resources that may not be readily available domestically. When tariffs are imposed, the cost of these parts are projected to increase drastically, leading to higher prices for consumers. Whether you need a new alternator on your Ford F150 or a radiator for your Subaru Impreza you will end up paying significantly more once the tariffs go into full effect.
We have compiled just some of the expert projections of the effects that tariffs will have on auto parts and maintenance costs.
- Increased Cost of Parts
Tariffs are taxes imposed on imported goods and when applied to automotive parts, they can significantly increase the cost of these components. For example, if a 25% tariff is imposed on a $100 radiator fan which is responsible for helping dissipate heat keeping the engine within operation temperatures, will mean that it now costs the company $125. This additional cost is passed on to the consumers. In the case of the radiator, it may increase its retail price as much as 40% so it could potentially go from costing $130 to $170. The main issue that is not talked about on the news is the fact that the manufacturer may be tempted to further increase margins as they may need to allocate additional resources on the evolving complexities related to the import process itself. Additionally, some manufacturers may use the opportunity to increase margins simply because they can. The bottom line is that all tariff related increases are going to be passed on to the consumer leading to higher prices for parts and repairs.
All vehicles sold in the US today have some components and materials sources from foreign countries. Almost all vehicle components can be affected. The number of foreign sources components used is highly dependent on the specific year, make and model of vehicle. Over 40% of an average US assembled cars are made overseas. Generally, a car that is made in America such as the Jeep Wrangler are comprised from 40% to 55% components sources from other countries. For imported vehicles that number will be considerably higher. Everything from engines and drivetrain components to tires and electrical systems are affected by tariffs. Even the raw materials from which cars are made are often exported from other countries.
- Impact on New Car Prices
It almost goes without saying that tariffs will play a huge role on new car pricing. This additional tax on imported parts will increase the cost of producing new vehicles. Almost all automakers rely on imported components and as their costs increase so will their prices. This will make it more expensive for consumers to purchase new vehicles, potentially reducing demand and affecting the automotive market.
Tariffs can also lead to supply chain disruptions, as manufacturers may need to find alternative suppliers or adjust their production processes. Already a few US car companies have announced that they are decreasing or holding some manufacturing. Stellantis/Chrysler/RAM/Jeep announced that they will temporarily stop manufacturing some of their most popular models such as the Jeep Grand Cherokee. These disruptions can result in delays and increased costs, further contributing to higher new car prices.
- Impact on Used Car Market
As new car prices rise due to tariffs, many consumers may turn to the used car market as a more affordable alternative. This increased demand can drive up the prices of used cars, making them less accessible for budget-conscious consumers.
The cost of maintaining and repairing used cars can also increase due to higher prices for imported parts. This can make owning a used car more expensive over time, affecting the overall cost of ownership.
- Impact on Repair and Maintenance Costs
As the cost of various vehicle components increases, the overall cost of repairs and maintenance will rise as well. Mechanic shops may need to charge more to cover the increased cost of parts, leading to higher repair and maintenance costs for consumers.
The higher cost of parts and service can be a significant barrier to general car ownership. This can lead to more used cars on the market in need of complex and expensive repairs as they were being deferred by the owners, potentially leading to more significant issues down the line.
- Economic and Environmental Considerations
As history has shown us, tariffs can lead to job losses. The devastating effect of these tariffs is especially prevalent in the automotive industry, particularly in areas where manufacturing and assembly rely on imported parts. Higher production costs may force manufacturers to reduce their workforce or move production overseas. Additionally, these higher costs for new and used auto parts and cars, as well as increased maintenance expenses, can reduce consumer spending in other areas, potentially impacting the broader economy.
What you can do today
Besides casting our vote in the next election there is not much as consumers we can do to change newly emerging laws and policies. However, there are a few things we can do to safeguard our interests.
- Regular Maintenance: Do not put off on doing regular maintenance. Regular maintenance can help prevent more expensive repairs down the line.
- Comparative shopping: Shop around for the best prices on parts and repairs. Online marketplaces and local suppliers may offer competitive prices, even in the face of tariffs.
- Consider using used parts: Consider using refurbished or used parts, which can be more cost-effective than new parts. Many reputable car dismantlers and suppliers offer certified used parts that are guaranteed to meet high standards.
Read more articles
